Wyden Urges Investigation of Potential Violations by Ocean Carriers
Senator says potential Shipping Act violations hurt Oregon agriculture and forestry exports
Washington, D.C. – U.S. Sen. Ron Wyden said today he is urging the Federal Maritime Commission (FMC) to continue investigating reports of unreasonable practices by ocean carriers, including refusal to carry certain agriculture products from U.S. ports back to Asia.
In a bipartisan letter from Wyden and 23 other senators, the lawmakers expressed support of the FMC’s current fact-finding efforts and asked that it take appropriate action against vessel-operating common carriers (VOCCs).
“As you know, ports across the United States are experiencing unprecedented congestion and record container volumes, which alone pose significant challenges for agricultural exporters seeking to deliver their products affordably and dependably to foreign markets,” the senators wrote FMC Chair Michael Khouri. “In the midst of this challenge, reports that certain VOCCs are returning to their origin with empty containers rather than accepting U.S. agriculture and forestry exports not only greatly exacerbates the problem, but potentially violates the Shipping Act as an unjust and unreasonable practice.
“The need is urgent, especially with record container volumes at the nation’s major ports. These volumes, and the resulting congestion, will only grow as the global economy recovers from the coronavirus pandemic,” the senators wrote. “Producers rely on competitive access to foreign markets, and the reported actions by certain VOCCs to undermine this access pose significant ramifications for agricultural exporters and the industry at large.”
Joining Wyden in signing the letter led by U.S. Sens. John Thune (R-S.D.) and Amy Klobuchar (D-Minn.) were U.S. Sens. John Barrasso (R-Wyo.), Marsha Blackburn (R-Tenn.), John Cornyn (R-Texas), Tom Cotton (R-Ark.), Steve Daines (R-Mont.), Tammy Duckworth (D-Ill.), Joni Ernst (R-Iowa), Dianne Feinstein (D-Calif.), Deb Fischer (R-Neb.), Chuck Grassley (R-Iowa), John Hoeven (R-N.D.), Jim Inhofe (R-Okla.), Cynthia Lummis (R-Wyo.), Roger Marshall (R-Kan.), Jerry Moran (R-Kan.), Patty Murray (D-Wash.), Mike Rounds (R-S.D.), Tina Smith (D-Minn.), Debbie Stabenow (D-Mich.), Thom Tillis (R-N.C.), and Raphael Warnock (D-Ga.).
“While we are aware that COVID19 has caused disruptions in the timely flow of containers and shipping, the current actions by the ocean carriers are predatory and damaging to all West Coast agri-products exporters,” said Gary Frederickson, President of Oregon Hay Products. “Instead of allowing us access to ‘empty containers’ which we use to ship U.S. products for sales to foreign countries, ocean carriers are refusing to release these containers to U.S. exporters. Instead, they are returning them ‘empty’ to Asia to expedite loading of products imported to the U.S. These actions are causing irreparable short-term harm to U.S. exporters and potentially permanent long-term harm as the U.S. becomes an unreliable source of products.”
“Protection afforded to the ocean carriers by the Shipping Act of 1984 and subsequent revisions, does not allow them to unilaterally limit access to the means necessary for US companies to conduct business,” said Stuart Follen, President of SL Follen Company. “Ocean carriers, by unnecessarily restricting access to ocean containers and shipping them back to Asia 'empty', are damaging countless American farmers, ag-processors and international trading companies throughout the United States and especially along the West Coast of the United States.”
Text of the letter is below.
The Honorable Michael Khouri
Chairman
Federal Maritime Commission
800 North Capitol Street, N.W.
Washington, D.C. 20573
Dear Chairman Khouri,
We write to express concern with the reported practices of certain vessel-operating common carriers (VOCCs) related to the denial of carriage for agricultural commodities. If the reports are true, such practices would be unreasonable, anticompetitive, and hurt millions of producers across the nation. We support the Federal Maritime Commission’s current efforts to investigate these reports, and call on the Commission to quickly resolve this critical issue.
As you know, ports across the United States are experiencing unprecedented congestion and record container volumes, which alone pose significant challenges for agricultural exporters seeking to deliver their products affordably and dependably to foreign markets. In the midst of this challenge, reports that certain VOCCs are returning to their origin with empty containers rather than accepting U.S. agriculture and forestry exports not only greatly exacerbates the problem, but potentially violates the Shipping Act as an unjust and unreasonable practice.[1]
We understand that the Commission in March 2020 initiated Fact Finding No. 29 – led by Commissioner Rebecca Dye – which was expanded in November 2020 to investigate reports of potentially unjust and unreasonable practices by certain VOCCs discussed above. We support this investigative effort, and – in the event that unjust or unreasonable practices by certain VOCCs are discovered – urge the Commission to take appropriate enforcement actions under the Shipping Act to put an end to such practices.
The need is urgent, especially with record container volumes at the nation’s major ports. These volumes, and the resulting congestion, will only grow as the global economy recovers from the coronavirus pandemic. Producers rely on competitive access to foreign markets, and the reported actions by certain VOCCs to undermine this access pose significant ramifications for agricultural exporters and the industry at large.
We look forward to reviewing the findings of Fact Finding No. 29 and other related FMC proceedings, and to working with the Commission to address this growing problem.
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